Oil stays steady before OPEC meeting

Oil prices steadied on Thursday, holding most of their recent gains before a meeting of oil producers that could extend production limits aimed at clearing a glut that has depressed the market for more than three years.

Ministers from the Organisation of the Petroleum Exporting Countries (OPEC), Russia and other producers meet in Vienna on Friday and are due to consider extending output cuts that began in January.

OPEC and its allies have agreed to reduce output by about 1.8 million barrels per day (bpd) until March 2018 in an attempt to empty inventories. Many analysts now expect them to extend the deal, possibly to the end of next year.

"An extension of the agreement or an increase in the cuts may be announced," said Jeffrey Halley of futures brokerage OANDA.

Brent crude oil LCOc1 was down 5 cents at $56.24 a barrel by 0820 GMT. US light crude was 15 cents lower at $50.54.

Both contracts have risen more than 15 per cent over the last three months as global oil supply has tightened.

OPEC's efforts have been hampered by higher production in some other parts of the world, including the United States, where shale oil production is reaching record highs.

Recent hurricanes in the Gulf of Mexico have also pushed up crude inventories in some parts of the United States as US refineries have been shut by flooding.

US commercial crude oil stocks C-STK-T-EIA rose for a third straight week, building by 4.6 million barrels in the week ending Sept 15 to 472.83 million barrels.

US oil production has reached 9.51 million bpd, up from 8.78 million bpd directly after Hurricane Harvey hit the US Gulf Coast.

US crude received some support from a strong draw in gasoline stocks by 2.1 million barrels to 216.19 million barrels, traders said.

The structure of oil futures prices suggests OPEC production cuts are beginning to have an impact, analysts say.

Front-month Brent futures have risen sharply in recent months, much more than forward prices. This has changed the Brent price curve, moving it into what traders call "backwardation", when prices for immediate delivery are higher than prices for later barrels.

Another report from Singapore adds: Oil pricing agency S&P Global Platts said on Thursday it planned to publish US crude prices during the Asia market close from December after US exports to the region rose.

Platts' move comes a year after rival price reporting agency Argus launched two Asia-delivered price indexes for US crude as they compete to be the benchmark for oil flows on the trade route that has opened up after Washington lifted a decades-old ban on crude exports at the end of 2015.

About a third of the United States' crude exports, or more than 56 million barrels, landed in Asia in the first half of 2017, Platts said in a note on its website.

Platts said it plans to publish four US crude prices at the close of Asia's market at 0830 GMT "to help bring transparency to these markets". The price quotes are for WTI-MEH, the price of West Texas Intermediate Midland crude at the Magellan East Houston Terminal (MEH), Light Louisiana Sweet (LLS), Southern Green Canyon and LOOP Sour.